Room for more
There's a growing number of pubs moving into the accommodation market, givings hotels and budget chains a run for their money.
Accomodation can be a very lucrative source of income for pubs. It's certainly an underexploited sector of the industry, and one that looks set for continued growth.
There are positive signs that consumers like staying in pubs and many licensees are noticing substantial knock-on effects for food and drink sales.
"It's fair to say that demand for pubs with letting rooms is high and some operators see the introduction of letting rooms as a positive addition to the bottom line and subsequently to the value of the property. The diversity of the income stream offers the potential for added security and protection against downturns in any one area of the business."
That's the verdict of Simon Hall, divisional director at the Leeds branch of property agent Fleurets. It's a view seemingly shared by a rising number of pubcos.
Moving into accommodationBoth Adnams and Young's have been actively pursuing the strategy of either developing new buildings or converting old ones to create rooms to let for some time now, in Young's case since 1989.
The Adnams estate now contains a total of 25 hotels (20 tenanted, two managed, three leased), while Young's has amassed 22 hotels (19 managed, two tenanted and one leased).
Young's spokesman Michael Hardman reveals the secret to the London brewer's success: "We have always purposefully kept the old pub intact as part of the hotel, offering the two services side by side."
This, says Hardman, ensures the venues remain popular with dedicated beer drinkers as well as attracting plenty of tourists and business travellers.
Adnams' general manager (retail), Rupert Farquharson, places the emphasis firmly on the Suffolk brewer's high-quality food service as a vital component of the new business, which he believes is complemented by accommodation.
He also says that there was a "need to satisfy the big demand for coastal hotels", allowing Adnams to corner the "local micro market" around many of its premises.
He does confess that there is definitely "a need to do more" with regards to the marketing of tenanted pubs to ensure their continued success under the Adnams banner.
Independent operators cash in
It is not just the big companies currently reaping the rewards from the accommodation market either. Freehouses such as the Fountain Inn at Tenbury Wells, Worcestershire, are also prospering.
The Fountain's owner Russell Allen confirms that an incredible 75% of his overnight guests are repeat-business customers, virtually guaranteeing the pub a regular stream of loyal trade.
The freehouse currently has 11 luxurious bedrooms and a mark of their appeal is that another seven will be added by the end of next year.
The rising popularity of pubs over hotels can also be seen in a new Camra publication: Room at the Inn. As editor Tim Hampson explains: "Over the last few years, there has been a silent revolution in the British pub and a quantum change in quality has taken place.
"Increasing numbers of travelling business people clamour, not for the bland anonymity of a branded hotel, but for a pub, to stay where real people sit and drink real beer."
